Auditing Paid Listings & Click-fraud Issues

Jessie Stricchiola starts off with a brief history of how she got into click-fraud. She had her tech team build a program to monitor click-fraud. Then identified two of the client's competitors who were clicking on the ads. The average costs were $1,500 per day! The company that was doing this fraud was ironically a law firm that worked on Internet fraud. Then GoTo.com (2002) gave the client a refund.

Fraudulent clicks come from:
- Competitors clicks; often manually, sometimes via automated 'hitbots'.
- CPC affiliate clicks; often via 'hitbots' and is generated by PPC partners from various locations. Its hard to detect these things and the CPC engines are also working on identifying and blocking it.
- Impression Fraud is an other concern. One of the criteria of ranking well in Google AdWords is your CTR. The higher the impressions but the lower the clicks, this can ultimately lead for your ad to be removed.

She adds that she feels one day they will be able to sue people and take them to court for click-fraud.

Lori Weiman from KeywordMax is giving a case study as I type. She started off describing how click fraud happens. They might click on your ad manually, or use a bot with a way to mask their IP. Then you have the stupid click-frauders that just click without masking IP. The affiliates are the smartest click-frauders, they mask IP, break the referral url and break your own tracking URLs.

How do you catch it? Use a tracking system that captures IP addresses, use a tracking system that captures the referrers. Audit your bills and what for click spikes, also watch for clicks from irrelevant geographic regions.

Case Study A:
Client A notices an ongoing spending increase of $30,000 per month on Tier 1 engines. It was detected by receiving threatening email from a disgruntled ex-employee, using keywordmax they saw 0% increase in conversions. The fraudster went to jail! This client had to ask for refunds, and it took a lot of time. The CPCs should have been more helpful.

Case Study B:
Client B had an affiliate fraud problem. He notices click spikes of 5x coming form a tier 2 engine, it was tracked and reported. The CPC engine refunded the money and they booted that affiliate. CPCs need preventive measures in place to stop this from happening in the future.

How to file a complaint?
- 60 days to file a complaint in writing
- Very thorough documentation and proof (keywords, date ranges, etc.)
- You will need to follow up with emails and phone calls.

What can the engines do to be more proactive:
- Detailed billing just like your phone bill. We want an itemized click bill.
- Set up Fraud Departments to handle this
- Communication and Willingness to work with customers

Danielle Leitch from MoreVisibility was up next.

Case # 1:
She saw normal traffic based on her Web analytics but when she looked at the AdWords report reported 5x more. She noticed a huge increase in clicks from the same keyword phrase, will a zero conversion rate. She basically had the same thing to say as the other two speakers (but she made a point to say that she never spoke with the other two speakers before today).

Case # 2:
Overture reported a 10x increase in overall clicks on a single day. Since there are no daily limits set, it could be very costly. Red flags were raised all over the place based on traffic, conversions, clicks and more. They looked at the server logs and found a pattern, they also looked at tracking URLs. She called Overture and reported the information to Overture. 1 week later she got her refund, which was good. They reviewed the previous weeks as well and credited for previous history as well.

Remember if you do get a refund, you must adjust your reports accordingly. Update your Web analytics and report data.

Q & A:

Q: Why are there no search engines on the panel?
A: The search engines declined to join.

Q: Do you think if you did not report this click fraud to the engines, you would have received a refund?
A: No. Jessie said Overture has done a lot to increase the comprehensiveness of the analytics and increased the support staff to support this. They can't disclose what they are doing because if they do, the spammers can work around it. She still says they should disclose it to the advertisers. If you are getting a refund, you should know exactly what you are being refunded for (which keyword, times, etc.), Lori adds. Danielle does not fault the engines, she said its up to us to report it to the engines. But Jessie does fault the engines. She points out the overture reps in the room.

Q: How do you contact the click fraudster? What is the best way to do it?
A: You must have evidence. If you do, then contact them.

Q: What percentage of overall traffic is click-fraud?
A: Jessie said its nearly impossible to figure that out because click-fraud is dollar, niche and keyword specific. She said there are probably verticals that don't have this problem, some keywords are hit more then others. She said "within competitive keyword phrases ($2 - $3+ per click), based on her opinion, about 10 - 20% are fraudulent.

Q: Did you ever make a case where you reported fraud and not get a refund?
A: Yes, and the CPCs were right in the case that they were not fraudulent. Sometimes there are partial or no refunds based on looking deeper in the details.

Q: Do CPC engines block IPs?
A: They handed the mic to Overture to answer the question. They sometimes do it but they rarely block IPs, they write filters to increase their fraud algorithms.